"He'd go over to Oliver's restaurant with his [10-year-old] son, Cooper," a neighborhood friend tells PEOPLE in this week's cover story. "They'd have lunch, and you'd see them talking and laughing for hours at a time."

"Then, come nightfall, you'd see Phil back at Oliver's, hunched over the bar, alone, looking like an entirely different man," says the friend. "He looked very dark and depressed."

In the cover story, friends, colleagues and neighbors remember the talented actor and devoted father of three – and detail his struggles as he slid back into addiction after decades of sobriety.

Despite his many accolades, the New York University grad could also be deeply critical of his own work. "I think the tortured part [of his acting] comes from him not settling," says Matthew Warchus, who directed Hoffman's Tony-nominated turn in 2000's Broadway smash True West.

"The audience benefits," says Warchus. "But the artist himself, it's a mixed blessing to have those standards. Nothing is easy."

For much more on this story, including details of Hoffman's final weeks and his life offscreen as a father of three, pick up this week's issue of PEOPLE, on newsstands Friday